diff --git a/src/resources/embedded_resources.cpp b/src/resources/embedded_resources.cpp
index 8ba2d56..266f0b5 100644
--- a/src/resources/embedded_resources.cpp
+++ b/src/resources/embedded_resources.cpp
@@ -274,8 +274,30 @@ static bool extractResource(const EmbeddedResource* res, const std::string& dest
     // Write file
     std::ofstream file(destPath, std::ios::binary);
     if (!file) {
-        DEBUG_LOGF("[ERROR] Failed to open %s for writing\n", destPath.c_str());
-        return false;
+        // The destination may be locked because the previous daemon is still using the binary:
+        // Windows locks a running .exe against truncation, Linux returns ETXTBSY. Both platforms
+        // DO allow renaming/moving such a file — the running process keeps the moved copy — so move
+        // the stale binary aside and write a fresh one at the original path.
+        std::error_code ec;
+        if (std::filesystem::exists(destPath)) {
+            std::string sidelined = destPath + ".old";
+            std::filesystem::remove(sidelined, ec);            // clear any leftover from a prior swap
+            ec.clear();
+            std::filesystem::rename(destPath, sidelined, ec);
+            if (!ec) {
+                file.clear();
+                file.open(destPath, std::ios::binary);
+                if (file)
+                    DEBUG_LOGF("[INFO] Replaced in-use %s (old copy moved to .old)\n", destPath.c_str());
+            } else {
+                DEBUG_LOGF("[WARN] Could not move stale %s aside: %s\n",
+                           destPath.c_str(), ec.message().c_str());
+            }
+        }
+        if (!file) {
+            DEBUG_LOGF("[ERROR] Failed to open %s for writing\n", destPath.c_str());
+            return false;
+        }
     }
     
     file.write(reinterpret_cast<const char*>(res->data), res->size);
@@ -413,7 +435,18 @@ bool extractEmbeddedResources()
         }
     }
 #endif
-    
+
+    // Best-effort cleanup of any ".old" binaries left behind by a previous in-use replacement.
+    // Once the old daemon/xmrig process has exited, the file is no longer locked and removes cleanly;
+    // if it's still running, the remove fails harmlessly and we retry on the next startup.
+    {
+        std::error_code ec;
+        for (const char* name : { RESOURCE_DRAGONXD, RESOURCE_XMRIG }) {
+            std::filesystem::remove(daemonDir + pathSep + name + std::string(".old"), ec);
+            ec.clear();
+        }
+    }
+
     return success;
 }